Inflation to Worsen the Housing Crisis in Addis Ababa

Are you wondering how difficult or easy finding an apartment for rent in Addis Ababa at an affordable rent is at this very moment? How about finding a reasonably priced house for lease in Addis Ababa?

The overall inflation rate the Ethiopian Statistics Agency posts monthly has been over 30% for several consecutive months. The rate at which home rental and sales prices have been increasing in Addis Ababa is far greater than this figure. The continuous devaluation of the Ethiopian Birr, the civil war in the north, south and west of the country, the removal of government subsidies on petroleum products, economic sanctions imposed on Ethiopia by The West, the impacts of the Covid-19 pandemic and the war between Russia and Ukraine on the global economy have each played a big role in causing this.

The rental prices of small dwellings in the city have increased nearly by 100% over the last year. This has made life unbearable for the general public, especially for the poor. There are signs that some residents of the city have been forced to return to their rural villages since life in Addis Ababa has become so difficult due to the rise in cost of living and the overall slow down of economic activities in the city. The rental prices of high end houses in Addis Ababa, which are usually quoted in US Dollars and are popular among expatriates, have dropped a bit due to slower demand than usual, which can be attributed to the civil war in the country and the covid-19 pandemic. However, those expats who are paid their salaries in Ethiopian Birr will feel the pain due to the devaluation of the Birr. You may see the latest offers on such options by clicking on this link.
Although renting apartments in Addis Ababa has become very popular among young professionals and small business owners in recent years, it looks like this phenomenon is going to be short-lived at least in the short run. The fact that the price of construction materials has increased by an average of 200% would mean that the supply of new apartments will stagnate, which in turn will push the rental prices for flats in Addis Ababa beyond their capacity to pay. The price of steel has increased by 300%, the price of cement has doubled and the price of aluminium has shot up by 400% in the last year.

With no end of the war in sight, the pressure coming from the international financial institutions on the government of Ethiopia to continue with devaluating the Ethiopian Birr and the bad state the global economy is in, the housing crisis in Addis Ababa is expected to get worse. If you are seeking help in finding the right apartment for lease in Addis Ababa or want to rent a house in Addis Ababa, browse our listing or get in touch with us.

Source: https://www.ethiopianproperties.com/